Credit Risk

Within the world of annuities, credit risk involves the possibility of loss due to the inability of insurance company to fulfill its financial obligations.

Calculating the Value of a Pension Buyout Offer

One way to evaluate a...

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Writing the Book on Retirement Portfolios

Anyone thinking about retirement income should pick-up a copy of Retirement Portfolios by Michael Zwecher.  This recommendation applies to both financial...

Structured Product Risks are a Hot Topic

Structured products are hot. U.S. sales rose 46 percent in 2010 to $49.5 billion. The appeal is understandable in the wake of the financial crisis. As folks in the indexed annuity business know, a floor of principal protection or "guaranteed" income combined with some upside potential is an easier sell in the current environment. Structured products also happen to be a hot topic with regulators. For example, FINRA just issued a warning to investors about structured products with principal...

Richard Thaler on Annuities

Richard Thaler is a professor at the University of Chicago and he is a renown economist. Best known for his work in the area of behavioral finance , Thaler focuses on how human psychology affects economic decision making. Thaler recently wrote a piece on annuities which was published in the New York Times. The Times article focused on the annuity puzzle . The term annuity puzzle is used to describe the lack of annuity adoption (purchases) relative to what economists would consider rational...

The Singularity Presents an Extreme Scenario for Retirement and Annuities

There is a prominent and growing group of people who believe that the exponential pace of technological progress will have a profound near-term impact on society.  Singularity is a term often associated with this school of thought.